Monthly Archives: July 2008

1 – Why no jail time?
2 – Why is he allowed to stay in this country?
3 – What kind of message does this send to criminals around the world?Russian immigrant stages crashes, steals $439K, but gets no jail time

A Russian immigrant who recruited people to take part in an insurance fraud scam focused on phony automobile accidents was sentenced today in federal court.

Radislav Lankin, 31, of Brooklyn, identified by a prosecutor as the third-ranking organizer of the Buffalo-based fraud ring, was sentenced by U.S. District Judge William M. Skretny.

After pleading guilty to fraud charges, Lankin was sentenced to five years on probation and ordered to repay $439,000 to insurance companies that were cheated. Skretny ordered him to spend three months of the probation period in home confinement and three months in a halfway house.

Lankin is the latest of 29 people convicted in connection with a fraud ring that has been investigated by the Western New York Health Care Fraud Task Force, Assistant U.S. Attorney John Rogowski said. Authorities have been investigating the group for about four years.

Lankin admitted that he would recruit people in the Buffalo area who agreed to falsely claim they were injured in car crashes. Members of the ring ran a fraudulent medical clinic, sold them unneeded crutches and other medical equipment and helped them file paperwork for false insurance claims.

A Russian immigrant who is now an American citizen, Lankin told Skretny he now works as a consultant for small businesses.

A website selling fake receipts recently posted a link to this blog, which previously included an item about the website. We certainly do not wish to give this website any publicity, but felt we should warn anyone about using fake receipts to submit insurance claims.

It’s a dumb thing to do because insurance companies do check the authenticity of receipts. The penalties for submitting fake receipts to boost a claim can be severe. Our files are filed with arrests and convictions involving false receipts. Check out these recent cases:

Think about a Middle Eastern terrorist, and a certain image comes to mind. How about a street mugger? You can picture him too. A corporate con man? White guy in an expensive suit, right? Think Enron or Worldcom execs. All of these are readily available images stored in our brains.

But what does insurance fraud look like?

It’s not easy stereotyping people who commit fraud. They’re of every stripe — male, female, young, old, black, white, brown, rich, poor, well-educated, poorly educated — and come from virtually every corner of the land and in between.

When the coalition was created 15 years ago, one of our founders challenged us to put a face on fraud. That’s a figure of speech — and something we’ve done.

But now we’ve done it literally, too. A new section of our website — Faces of Fraud — features photographs of people who’ve been convicted of insurance fraud, along with a little information on what they did and how they’re paying for their crime.

The purpose of the photo display is to illustrate that insurance fraud is not a faceless crime. The people who commit fraud look like us, our friends, neighbors and co-workers. And they demonstrate that anybody who does it can get caught and punished.

Toyota — the preeminent car maker that ran TV ads six months ago encouraging people to dump their cars — has been named the most reputable company in the world.

According to the Reputation Institute, a New York consulting group, the car maker bested 600 of the world’s largest corporations in a survey about product and service quality, innovation, workplace, governance, leadership, performance and . . . citizenship.

Citizenship? What good corporate citizen flagrantly encourages people to commit crime? How sad.

Car giveups are certainly on the rise, and that likely is due more to the bad economy than Toyota commercials. Still, this recognition seems to be another example of a corporation getting away with unsavory behavior.

Perhaps we should give those surveyed the benefit of the doubt. Perhaps they placed more emphasis on product than citizenship.

In any event, in the list of top-rated U.S. companies, five insurers placed in the top 75 — Travelers (#61), State Farm (#63), Hartford (#65), Metlife (#72) and Chubb (#74). At a time when insurers’ standing with the public is sagging, it’s good to see the industry represented on the list — as tainted as it may be with Toyota at the top.

And speaking of lists, Wards published its annual compilation of the top 50 insurers based on financial performance, safety and consistency. Eight insurer members of the coalition made the grade: Allstate, Erie Insurance, Fireman’s Fund, Hartford, MetLife, Progressive, Selective and Travelers.

Few aspects of insurance fraud are simple. Sophisticated techniques such as predictive modeling are used to detect it. Forensic science, often involving voluminous paper trails, is used to investigate it. Complex strategies are employed to prosecute it.

So when something simple comes along that’s effective, we take notice.

That’s a good description of the Fraud Interdiction Program established by the Los Angeles District Attorney’s office. It’s the kind of idea that leaves you scratching your head, wondering why no one thought of it before.

The idea arose when someone surmised that medical providers who steal from insurance companies probably cheat on their taxes, too. It was a theory easily validated: Just find out how much insurers have paid individual providers and compare that with the providers’ tax returns.

That’s what Asst. District Attorney Al MacKenzie began doing in 2004, launching a long line of successful prosecutions of crooked doctors and lawyers. Tax cases are a slam dunk compared to the many fraud cases that require proof of intent and documentation of medical procedures. Confronted with simple facts involving tax evasion, many defendants quickly cop a plea and go straight to jail. Plus, prosecutors don’t have to convince juries that insurance companies are victims and that doctors — often seen as pillars in the community — are criminals.

Al’s program earned him the first “Prosecutor of the Year” award conferred by the coalition this week.

His track record with this novel program is impressive. In the last year, he’s landed 15 convictions entailing more than $20 million in stolen money. What’s more, the program has identified some 200 suspects who may have defrauded as much as $300 million. So, expect similar cases rolling out of this pipeline for many years to come.

In accepting his award, Al explained that suspicion of tax evasion permits prosecutors to obtain search warrants more quickly, which helps them gather evidence of insurance fraud that they may not have discovered otherwise.

Al’s program is now being emulated elsewhere around the country. And, to his credit, he is enthusiastically assisting other jurisdiction in setting up their own fraud interdiction programs.

We’re thrilled to recognize such a deserving public servant.

And as a side note, Al’s boss, District Attorney Steve Cooley, deserves praise as well for backing a new program and supporting Al’s efforts. As an elected official, it takes courage to embrace unconventional ideas that potentially could backfire. Kudos to both.